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Enhancing Employee Rights: 2024 Romanian Legislative Updates

Diana Chitu

2 Min Read

In 2024, Romania introduced several legislative changes that significantly impact employees across various sectors.

In 2024, Romania introduced several legislative changes that significantly impact employees across various sectors. The updates aim to enhance work-life balance, improve employee protections, and modernise the healthcare system. Here’s a detailed look at the key changes:

Recent Changes to be Aware of:

  • Pensions: From 1 January 2024, the contribution to Pillar 2 (mandatory private pension pillar) was increased from 3.75% to 4.75% of the salary, while 20.25% (decreased from 21.25% previously) of the salary will go to the Pillar 1 (state) pension. There is also still an option to contribute to the voluntary pension funds, part of Pillar 3.
  • Early education allowance: As of 1st January 2024, employers are able to cover early education costs for their employees’ children up to 1,500 lei per month. If parents pay these expenses directly, employers can reimburse them up to the same monthly limit. This amount is exempt from social taxes, but total benefits cannot exceed 33% of the basic salary. This benefit is optional for employers and applicable to profit tax-paying companies, which can then deduct the expenses from their profit tax. Its uptake by employers remains to be seen as it is a new provision.
  • Meal vouchers: 1 January 2024 saw the maximum value of meal vouchers increase to 40 RON per working day. These vouchers remain exempt from social taxes but are subject to a 10% income tax. An additional 10% tax for the public health system (CASS) was applied, but despite this people are still free from the remaining 25% social taxes, including social security and pension contributions, making them a popular benefit.
  • Remote work regulations: Employers must now provide financial compensation for expenses incurred by employees working from home, including electricity, internet, and other utilities. Additionally, employers must ensure that remote employees have adequate equipment and ergonomic setups to comply with health and safety standards.
  • Probation period: Aiming to ensure fairness and consistency across industries, new legislation has standardised probation periods across different sectors, setting a maximum of 90 days for non-managerial positions and 120 days for managerial roles.
  • Protection against unfair dismissal: Employers are now required to provide more substantial evidence and justification for dismissals, particularly in cases of performance-related terminations.
  • Work-life balance: The law now requires employers to honour flexible working arrangements where feasible, including part-time work and alternative schedules.

Now these legislative updates have come into effect, ensuring compliance and maximising the benefits for both employers and employees can be a complex process. Our team of experts stands ready to assist you in understanding and implementing these changes effectively.

Diana Chitu

Head of Health & Benefits Department
GrECo Romania

T +420 735 175 613

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